Hidden Cities: The Secret to Low-Cost Airfare

Summer is around the corner and it's peak travel season, which means it could take a toll on your budget. Fortunately, the financial experts at Money Under 30 have shared some travel hacks for getting to your destination at half the price. It's all about sidestepping airlines' arbitrary rate hikes for major travel hubs by getting out at the 'hidden city' halfway through your trip.

"The general gist is this: I live in Portland, Maine. If I wanted to book a direct flight to Chicago, it would be extremely expensive. But if I book a one-way ticket to Denver and it goes through Chicago for a layover, it might be only half the cost. Chicago would be the 'hidden city' in that case," said David Weliver, founding editor of Money Under 30.

Unfortunately, this strategy won't help if you're flying from one small city to another. And it only works for one-way tickets, because if you don't make it to your planned destination, the airline automatically cancels the return trip.

"I think before the airlines caught on, people could be savvy and make up some excuse to get the return ticket okayed," said Weliver. "But I don't think they do that anymore. Nowadays, the ticket's only good from where you booked it."

Hard-core travelers have been flying to 'hidden cities' for years, but recently, airlines have begun to get wind of the practice. Their entire pricing system is based on supply and demand of where people most want to visit. Airlines know that nonstop flights are more valuable, so they are more expensive.

If Weliver's example above were calculated merely on distance, Denver should cost much more to get to than Chicago, as it's much farther away. However, more business travelers fly to Chicago than to Denver, so flights can be twice as expensive. Especially when you're flying from a small airport with a limited number of daily flights to a large national hub.

Chicago is a big hub for United Airlines. Detroit or Atlanta is a likely layover for Delta Air Lines. In any of the big cities, most of the U.S. airlines will stop somewhere you'd want to visit. But in others, like Boston, there are so many inexpensive trips to big hubs like Chicago, this might not be your best strategy.

"But if you're going from a small city to a big, in-demand route, this makes the most sense," said Weliver. "You can find yourself getting 25 to 50 percent off the cost of the ticket."

Airlines don't want to lose money. In fact, United and Orbitz sued 24-year-old Aktarer Zaman of Skiplagged.com two years ago for his company's 'hidden city' practices, calling the startup website "unfair competition." Orbitz eventually backed out, and a Chicago judge dismissed the United case as out of his jurisdiction.

It's also very important to price out different options. Sometimes, two one-way tickets don't make sense, even with the 'hidden city' benefit. But other times, it can result in significant savings.

"For a direct route from Portland to Chicago, a non-stop ticket would be $800 or more," said Weliver. "But they have to connect there anyway during Denver flights, because it's such a popular route for business. So let's say I could find a 'hidden city' route that is half the price. That's pretty good, even with the hassle of two one-way tickets."

This is also great if you are flying into a city with a one-way ticket, then driving to another city. It's ideal if you're visiting a place for an extended stay, and don't know when you'll be returning.

Go Global

For international flights, you can save money if you buy the ticket from a retailer in the country you're planning to visit. Depending on currency exchange rates and ticket pricing, you can save several hundred dollars on airfare. Weliver suggests doing a search via the simple pricing tool called Flight Matrix ITA Software. But you may have to jump through some hoops.

"The trick is, you have to find a way to buy it locally, and you may even have to have an address in that country," he said. "You can best take advantage of this if you have a friend or family member in the country you want to visit, and get them to buy it."

As Weliver noted earlier, airlines are beginning to get wise to this workaround. Claiming it is unfair to use their ticketing policy in this way, they have incorporated legal language into airfare contracts regarding canceling. Unless you find a very nice agent, they are unlikely to rebook your return ticket in the case of round-trip travel. And they may try to penalize you.

"One risk is if you happen to be a frequent flier, they could cancel or invalidate your frequent flier account if they catch you," said Weliver. "But that's about all they can do. And if you buy a new one-way ticket home, I don't think they can refuse you, because you're not breaking any laws. But it's one of these things where you could do it once or twice to save a little money, but I'd be careful not to make a habit of it."